DETERMINANTS OF PROFITABILITY: A STUDY ON CERAMIC INDUSTRY IN BANGLADESH
DOI:
https://doi.org/10.46273/jobe.v10i2.319Keywords:
profitability, ceramic industry, Dhaka stock exchangeAbstract
This study aimed to establish the key determinants of the profitability of ceramic companies. For this purpose the data of all ceramic companies were selected from DSE. The research period covered from 2015-16 to 2020-21. Return on Assets (ROA) and Return on Equity (ROE) were used as the indicators of profitability, while Management efficiency, Capital intensity, Firm size, Sales growth, Liquidity, Working capital, Leverage, Annual inflation and GDP annual growth were used as the independent variables. Pearson's correlation and ordinary least squares regression models were used to establish the relationship between profitability and its different determinants. The regression analysis results showed that liquidity and firm size have a statistically significant positive impact on profitability along with sales growth, capital intensity, management efficiency. On the other hand, working capital had a negative impact on profitability; others had no significant impact on profitability. Therefore, this research concludes that we should give more emphasize on liquidity and firm size for increasing ceramic companies' profitability.
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Akben-Selcuk, E. (2016). Does firm age affect profitability, Evidence from turkey. International Journal of Economic Sciences, 5(3), 1-9.
Al-Jafari, M. K. & Samman, H. A. (2015). Determinants of profitability: evidence from industrial companies listed on Muscat Securities Market. Review of European Studies, 7, 303.
Aparna, K. (2015). Determinants of profitability-a firm-level study of steel authority of India Limited (SAIL). Journal of Business Management & Social Sciences Research (JBM&SSR), 4(12), 1-4.
Demsetz, H. & Villalonga, B. (2001). Ownership structure and corporate performance. Journal of Corporate Finance, 7(3), 209-233.
Dickinson, V. & Sommers, G. A. (2012). Which competitive efforts lead to future abnormal economic rents? Using accounting ratios to assess competitive advantage. Journal of Business Finance & Accounting, 39(3‐4), 360-398.
Egbunike, C. F. & Okerekeoti, C. U. (2018). Macroeconomic factors, firm characteristics and financial performance: A study of selected quoted manufacturing firms in Nigeria. Asian Journal of Accounting Research, 3(2), 142-168.
Eljelly, A. M. (2004). Liquidity‐profitability tradeoff: An empirical investigation in an emerging market. International Journal of Commerce and Management, 14(2), 48-62.
Ehi-Oshio, O. U., Adeyemi, A., & Enofe, A. O. (2013). Determinants of corporate profitability in developing economies. European Journal of Business and Management, 5(16), 42-50.
Fareed, Z., Ali, Z., Shahzad, F., Nazir, M. I., & Ullah, A. (2016). Determinants of profitability: Evidence from power and energy sector. Studia Universitatis Babes-Bolyai, 61(3), 59.
Goldar, B. & Aggarwal, S. C. (2005). Trade liberalization and price‐cost margin in Indian industries. The Developing Economies, 43(3), 346-373.
Hassan, S. R. & Muniyat, S. (2019). Factors influencing the profitability of pharmaceutical companies in Bangladesh. In MESSAGE FROM THE CONFERENCE CHAIRS (p. 770).
Hossain, T. (2020). Determinants of profitability: A study on manufacturing companies listed on the Dhaka stock exchange. Asian Economic and Financial Review, 10(12), 1496-1508.
Ifeduni, A. S. & Charlse, O. (2018). The determinants of profitability of manufacturing firms in Nigeria. International Journal of Economics, Commerce and Management, 6(4), 479-493.
Jamali, A. H. & Asadi, A. (2012). Management efficiency and profitability in Indian automobile industry: From theory to practice. Indian Journal of Science and Technology, 5(5), 2779-2781.
Khan, T., Shamim, M., & Goyal, J. (2018). Panel data analysis of profitability determinants: Evidence from Indian telecom companies. Theoretical Economics Letters, 8(15), 3581-3593.
Klaus, G., Mueller, D. C., & Yurtoglu, B. B. (2004). Corporate governance and the return on investment. Journal of Law and Economics, 47(2), 589-633.
Liuspita, J., & Purwanto, E. (2019). The profitability determinants of food and beverages companies listed at the Indonesia stock exchange. International Journal of Scientific & Technology Research, 8(9), 197-202.
McGivern, M. H. & Tvorik, S. J. (1997). Determinants of organizational performance. Management Decision, 35, 417-435.
Nanda, S. & Panda, A. K. (2018). The determinants of corporate profitability: an investigation of Indian manufacturing firms. International Journal of Emerging Markets, 13(1), 66-86.
Nusbantoro, A. J., Utami, E. S., & Sanjaya, N. A. (2018). The determinants of profit change in manufacturing companies at the Indonesian Stock Exchange. Review of Management and Entrepreneurship, 2(1), 17-30.
Pervan, M., Pervan, I., & Ćurak, M. (2019). Determinants of firm profitability in the Croatian manufacturing industry: Evidence from dynamic panel analysis. Economic Research-Ekonomska Istraživanja, 32(1), 968-981.
Prasetyantoko, A. & Rachmadi, P. (2008). Determinants of corporate performance of listed companies in Indonesia. University Library of Munich, Germany.
Pratheepan, T. (2014). A Panel Data Analysis of Profitability Determinants: Empirical Results from Sri Lankan Manufacturing Companies. International Journal of Economics, Commerce and Management, 2(12), 1-9.
Prempeh, K. B., Sekyere, A. M., & Addy, E. K. A. (2018). A Multivariate Analysis of Determinants of Profitability: Evidence from Selected Manufacturing Companies Listed on the Ghana Stock Exchange. Journal of Accounting, Business and Finance Research, 2(1), 26-33.
Rezina, S., Ashraf, A., & Khan, M. A. (2020). An inferential study on the profitability determinants of the cement industry in Bangladesh. Asian Finance & Banking Review, 4(2), 8-21.
Sivathaasan, N., Tharanika, R., Sinthuja, M., & Hanitha, V. (2013). Factors determining profitability: A study of selected manufacturing companies listed on Colombo Stock Exchange in Sri Lanka. European Journal of Business and Management, 5(27), 99-107.
Zaid, N. A. M., Ibrahim, W. M. F. W., & Zulqernain, N. S. (2014, February). The Determinants of Profitability: Evidence from Malaysian Construction Companies. In Proceedings of 5th Asia-Pacific Business Research Conference (pp. 17-18).
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Published
2022-12-30
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How to Cite
DETERMINANTS OF PROFITABILITY: A STUDY ON CERAMIC INDUSTRY IN BANGLADESH (I. Sharma , Trans.). (2022). Journal of Business And Entrepreneurship, 10(2), 161-169. https://doi.org/10.46273/jobe.v10i2.319
